A brand-spankin' new version of PSfrag, version 3.03, for LaTeX2e can be
found at CTAN sites in the directory

macros/latex/contrib/supported/psfrag.

PSfrag 3.03 fixes two bugs discovered in PSfrag 3.02, and improves the
robustness of the \tex scanner. It should be installed over any copy
of PSfrag 3.02 that is out there.

For those of you that are slow, and haven't downloaded PSfrag 3.0 yet:
PSfrag 3.x constitutes a near-complete reimplementation of the internals
of PSfrag. Veteran PSfrag users will note the absence of the ps2frag
script; that is because _it is no longer necessary_.

What is PSfrag?
---------------

Many drawing and graphing packages produce output in the Encapsulated
PostScript (EPS) format, but few can easily produce the equations and
other scientific text of which LaTeX is capable. On the other hand, many
LaTeX-based drawing packages are not as expressive or easy-to-use as the
many advanced drawing packages that produce EPS output.

PSfrag provides the best of both worlds by allowing the user to
precisely overlay Encapsulated PostScript (EPS) files with arbitrary
LaTeX constructions. In order to accomplish this, the user places a
simple text ``tag'' in the graphics file, as a ``position marker'' of
sorts. Then, using simple LaTeX commands, the user instructs PSfrag to
remove that tag from the figure, and replace it with a properly sized,
aligned, and rotated LaTeX equation.

The full documentation for PSfrag found in the release contains examples
and usage instructions.

To use PSfrag...
----------------

...you will need:

* LaTeX2e and the "graphics" package. (You can use the old epsf.sty
  macros with PSfrag, but you still need the graphics package.) Please
  make sure to get the newest versions of these packages from CTAN
  before submitting bug reports.

* Any DVI-to-PostScript program that is well-supported by the "graphics"
  package. This author uses Tom Rokicki's "dvips"; I recommend it.
  PSfrag has also been verified for DVIPSone from Y&Y (using Level 2
  PostScript printers). PSfrag is intended to work with any driver that
  is fully supported by the "graphics" package, however.

Changes from PSfrag 2.x
-----------------------

PSfrag 3.0 has eliminated the pre-processing step required in the past.
As a result, the ps2frag script is now obsolete. However, as a
consequence, the PSfrag replacements don't show up in their proper
places until the PostScript file is generated. If you look at the .dvi
file with a viewer like XDvi, you will see the replacements lined up to
the left of your figure in a vertical list. This is NOT a bug, but a
necessary consequence of the elimination of the preprocessing step.

PSfrag now fully supports compressed EPS files, as long as they do not
contain embedded \tex commands. The \tex macro, therefore, has been
deprecated; support for the \tex macro must be explicitly requested by
passing an option to the package. (It still works rather well, though.)

Bugs? What Bugs?
----------------

PSfrag 3.03 is bug-free. Of course, we're kidding. That's what we said
about PSfrag 3.0, in fact, and look where it got us.

If you have problems, bug reports, or improvement suggestions, please
send them to the PSfrag maintainer's mailing list,

psfrag@rascals.stanford.edu

Please supply an example .tex file and .eps figure to demonstrate the
behavior you wish to have corrected or improved.

This is a majordomo mailing list; feel free to join if you would like to
actively participate in PSfrag development.

Thanks for using PSfrag!